Sampoerna applauds policy on cigarette excise

Indonesia’s largest cigarette producer, PT HM Sampoerna, says it appreciates the government’s decision to keep the excise on hand-rolled cigarettes (SKT) unchanged at Rp 80 (US$0.01) per cigarette this year.

Despite rising concerns about an excise hike on tobacco products starting next year, HM Sampoerna CEO Paul Norman Janelle said he appreciated the government’s effort to consider the impact of the policy, especially on employees and farmers.

"It's important that the government listens and in this case the government has listened especially in terms of SKT. [The government] has been taking into consideration the livelihood of the clove and the tobacco farmers," he said in Jakarta on Wednesday.

The government announced an increase in the tobacco excise by an average of 11.19 percent, starting Jan. 1, 2016, after taking into account both the conditions of the cigarette industry and public health concerns.

The highest excise increase of 12.96 to 16.47 percent will be applied to machine-rolled cigarettes (SKM), while the lowest increase of zero to 12 percent will be bestowed on hand-rolled cigarettes (SKT).

Tobacco is still the main source of excise revenue for Indonesia. This year, the government has set a target to receive Rp 139.12 trillion ($10.29 billion) in revenues from tobacco products.

For 2016, the government aims for total excise revenues of Rp 155.52 trillion, which includes Rp 148.86 trillion from tobacco products and Rp 171.2 billion from liquor. 

Source:, 15/12/15
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